United States District Court, N.D. California
ORDER DENYING DEFENDANTS' MOTION TO DISMISS
PLAINTIFF'S FIRST AMENDED COMPLAINT AND SETTING CASE
MANAGEMENT CONFERENCE RE: DKT. NOS. 60
HAYWOOD S. GILLIAM, JR., United States District Judge
Pacific Gas & Electric Company (PG&E), Albert Torres,
Bill Chen, and Tanisha Robinson move to dismiss the First
Amended Complaint (“FAC”) filed by Plaintiff
North Star Gas Company. More specifically, they seek to
dismiss Plaintiffs claims pursuant to (1) the doctrine of
respondeat superior and (2) the Sherman Act, 15 U.S.C.
reasons set forth below, the Court DENIES
Defendants' motion to dismiss.
Court summarized the relevant factual allegations of this
case in addressing Defendants' first motion to dismiss.
See Dkt. No. 53 at 2-5.
filed this action on June 9, 2015, asserting claims under
federal and state law. Against Torres, Chen, and Robinson
(“Individual Defendants”), Plaintiff asserts
substantive and conspiracy claims under the civil Racketeer
Influenced and Corrupt Organizations Act (RICO), 18 U.S.C.
§ 1961, et seq. FAC ¶¶ 97-118.
Against PG&E alone, Plaintiff asserted nine claims,
including-as relevant here-respondeat superior
liability for the RICO counts, id. ¶¶
119-25, and attempted monopolization in violation of the
Sherman Act, id. ¶¶ 126-44.
September 15, 2015, Defendants moved to dismiss
Plaintiff's original complaint, pursuant to Federal Rule
of Civil Procedure 12(b)(6). Dkt. No. 22. On September 26,
2016, the Court issued an order granting in part and denying
in part Defendants' motion. As relevant here, the Court
dismissed Plaintiff's Sherman Act claim, finding that
Plaintiff's “refusal to deal” theory of
antitrust injury was not cognizable under Section 2. Dkt. No.
53 at 41. The Court also found, however, that it could not
rule out the possibility that Plaintiff could allege facts to
support a business torts theory of anticompetitive conduct,
and granted leave to amend on that ground. Id. at
Plaintiff's respondeat superior claim,
Defendants failed to argue in their motion that Plaintiff had
inadequately pled those claims, instead raising that argument
for the first time in their reply brief. See Dkt.
No. 53 at 29-20 n.8. Because the Court does not consider
arguments raised for the first time on reply where doing so
could prejudice the opposing party, the Court was not
inclined to consider the argument. Id. Nevertheless,
Plaintiff's counsel acknowledged at the motion hearing
that its respondeat superior claims needed to be
pled with greater specificity, so the Court dismissed the
claim with leave to amend. Id.
October 26, 2016, Plaintiff filed the FAC. Dkt. No. 56.
Defendants filed this second motion to dismiss the FAC on
November 9, 2016. Dkt. No. 60. On January 24, 2017, the Court
issued an order directing the parties to provide supplemental
briefing on the legal basis, if any, for allowing a showing
of anticompetitive conduct under Section 2 in a regulated
industry based on a business torts theory. Dkt. No. 75. The
parties did so on February 6, 2017. See Dkt. No. 78
(Plaintiff's briefing); Dkt. No. 79 (Defendants'
Rule of Civil Procedure 8(a) requires that a complaint
contain “a short and plain statement of the claim
showing that the pleader is entitled to relief[.]” A
defendant may move to dismiss a complaint for failing to
state a claim upon which relief can be granted under Federal
Rule of Civil Procedure 12(b)(6). “Dismissal under Rule
12(b)(6) is appropriate only where the complaint lacks a
cognizable legal theory or sufficient facts to support a
cognizable legal theory.” Mendiondo v. Centinela
Hosp. Med. Ctr., 521 F.3d 1097, 1104 (9th Cir. 2008). To
survive a Rule 12(b)(6) motion, a plaintiff must plead
“enough facts to state a claim to relief that is
plausible on its face.” Bell Atl. Corp. v.
Twombly, 550 U.S. 544, 570 (2007). A claim is facially
plausible when a plaintiff pleads “factual content that
allows the court to draw the reasonable inference that the
defendant is liable for the misconduct alleged.”
Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009).
reviewing the plausibility of a complaint, courts
“accept factual allegations in the complaint as true
and construe the pleadings in the light most favorable to the
nonmoving party.” Manzarek v. St. Paul Fire &
Marine Ins. Co., 519 F.3d 1025, 1031 (9th Cir. 2008).
Nonetheless, courts do not “accept as true allegations
that are merely conclusory, unwarranted deductions of fact,
or unreasonable inferences.” In re Gilead Scis.
Secs. Litig., 536 F.3d 1049, 1055 (9th Cir. 2008). And
even where facts are accepted as true, “a plaintiff may
plead [it]self out of court” if it “plead[s]